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September 2014 Archives

Federal Tax Liens

For those who have an outstanding balance to the IRS, there are few things fraught with more anxiety than a federal tax lien. A federal tax lien is a legal claim the IRS imposes against a Taxpayer's property when he or she neglects to pay taxes when due. This claim extends to all property, including real property, bank accounts, investment accounts and personal items. A federal tax lien exists after the IRS makes a tax assessment and provides notice of the amount you owe and a demand for payment. For those who file tax returns with balances due and no payment, a tax assessment happens once the IRS processes the return and puts the amount owed on the books. A notice and demand for payment comes in a letter from the IRS stating the balance due and a deadline for payment.

How to Avoid an IRS Levy

Your tax return is complete but instead of a refund, you get hit with a huge tax bill. Do not fret. Outside of a few narrow circumstances, the IRS cannot levy your income or assets without first providing you with proper notice. By law, the IRS must give the taxpayer notice and demand for payment also known as a CP 501 notice. This essentially means that you have a balance due to the IRS. The IRS must also provide the taxpayer with a notice of intent to levy and notice of your right to a hearing. This notice is usually issued once the IRS has notified you of a balance due and the account remains unsatisfied. This notice also allows you to preserve your appeals rights.

Two of the Internal Revenue Service's Most Important Collection Tools: Liens and Levies

IRS liens and IRS levies are two of some of the most important tools, (some might say "weapons"), that the IRS has at its disposal for collecting taxes owed. However, it is important to distinguish between IRS liens and IRS levies.

Not Paying Your Taxes Can be Expensive

Many taxpayers fail to pay their taxes. The Internal Revenue Service ("IRS") estimates that about seven million Taxpayers failed to file an income tax return and pay their income tax. This is a significant revenue problem for the IRS, as that causes a $28 billion shortfall. Because of this, the IRS has a strong incentive to collect that missing tax.

When To Disclose Your Offshore Accounts

What are some things that come to mind when you hear offshore account? Many assume tax evasion is the only purpose of an offshore account. But in fact, there are many valid reasons for holding offshore accounts. For U.S. taxpayers living and working abroad, it could be a means of convenience and as business is becoming more global, offshore accounts are used for investments and other international transactions.

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